Regulatory capture is a form of government failure that occurs when a regulatory agency created to act in the public interest, instead advances the commercial or political concerns of special interest groups that dominate the industry or sector it is charged with regulating and introduced in an article by George J. Stigler in 1971 entitled The Theory of Economic Regulation. The main idea of the article can be summarized in Stigler’s (1971: 3) affirmation that:

“…as a rule, regulation is acquired by the industry and is designed and operated primarily for its benefits.”

The basic hypothesis of Stigler is that an industry may use—or rather abuse—the coercive public power of the State to establish and enforce rules in order to obtain private gain.

Historians will at some point recognize 1995 as the “regulatory capture” inception point of American medicine when the Federation of State Physician Health Programs ( FSPHP ) forged a relationship with the Federation of State Medical Boards (FSMB), the national organization responsible for the licensing and discipline of doctors and memorialized in a 1995 Journal of Medical Licensure and Discipline(Vol82N3)with articles claiming high success rates in eight state PHPs.

An accompanying Editorial written by past President of the FSMB Barbara S. Schneidman, MD, MPH concluded that:

“cooperation and communication between the medical boards and the physician health programs must occur in an effort to protect the public while assisting impaired physicians in their recovery.”

Roger A. Goetz of the the Florida Impaired Practitioners Program, for example reported that 84% of all referrals to the PRN “Occur prior to any violation of the Medical Practice Act or any evidence of patient harm.” Journal of Medical Licensure and Discipline(Vol82N3) As protecting the public from patient harm is the primary directive of medical boards those statistics seem pretty impressive! That the PRN prevented inevitable spirals of drug addled and besotted doctors from mayhem is questionable as how many were just like Leonard Masters? After being accused of overprescribing Goetz told Masters he could either relinquish his license or have an evaluation. Masters chose the evaluation thinking he would be returning in 4-days but was diagnosed as an alcoholic and spent 4-months. He didn’t even have a drinking problem. He successfully sued G. Douglas Talbott and the facility for false imprisonment, malpractice and fraud.

Goetz was also instrumental in promoting the chronic-relapsing brain disease model as a pathway to return revoked medical licenses. No matter how abhorrent their behavior, by misplacing blame on the “disease” doctors who should have hung up their smocks forever quickly returned to practice as they didn’t do it the drugs or alcohol did. In this manner serial sex-offenders, pedophiles, date-rapists using roofies and fiends who replaced dying cancer patients narcotics with saline and let them die in agony were quickly returned to the fold. The error in this thinking is that for the most part drugs and alcohol may induce good people to do disinhibited things or stupid things but they do not make good people do bad bad things. Empathy and moral compass are innate and the majority of doctors would not roofie drinks or take away dying patients pain meds under any influence. Unfortunately no test exists for psychopathy.

Many found employment as medical directors of these specialized programs and others became active in their states PHPs.

Since that time the FSPHP has duped the FSMB easier easier than a carney dupes a rube.

They asked the FSMB to approve public-policy to request state medical boards provide absolute deference to their state PHPs as their experts in all things related to physician health and to agree to never ever question their decision making skills regarding monitored doctors lest it “undermine a culture of professionalism” and this was agreed to.

Deference is acceptable but agreeing to blind deference and accepting the delusion of infallibility is unwise. A culture of deference is unacceptable. Lord Acton noted in a letter to a friend that the main point he was trying to get across when he wrote “Power tends to corrupt, and absolute power corrupts absolutely”was not that power corrupts powerful people but that power corrupts otherpeople. This dynamic certainly holds here. They make allowances.

Since that time they have expanded from ‘impaired physicians” to “disruptive physicians” to the “aging physician.” They have gained power and autonomy without regulation or oversight and by removing transparency and absolutely zero accountability they have essentially run amuck.

In 1995 this was a simple but growing shakedown scheme using a medical license to extract money under the threat of its loss. The PHP refers doctor X to “PHP-approved facility” for an evaluation and the “PHP-approved” facility tells doctor X you will stay here until I say so or I tell the PHP you ain’t gettin your license back. Doctor X stays because he knows the PHP can do it as the PHP is not going to be questioned by the medical board.They refer to it as “contingency-management” but it essentially meets the criminal definition of extortion.

Business has boomed since 1995 as they introduced non-FDA approved drug and alcohol tests into the market even though they are unvalidated with very low specificity. Junk-gadgets such as the SCRAM alcohol monitoring bracelet and the Soberlink cellular photo breathalyzer have been promoted as accurate and valid. None of this has any oversight but their linkages with the drug and alcohol testing, assessment and treatment industry has become an enormous gold mine. Both the drug-testing and assessment and treatment industry are multi-billion dollar enterprises.

The FSMB even made it public policy for medical boards to provide deference to PHPs and consider them experts in all things physician health. In this manner they have introduced a panoply of junk science, brought legions of polygraph examiners out of their basements and rebranded the 360 degree personal development employee assistance tool as a bona fide diagnostic instrument used for disruptive physician evaluations. The FSMB has also accepted concocted and imaginary concepts such as “potentially impairing illness” and “relapse without use” as not only nonfictional but medically scientific truth. If they proposed tiddlywinks for assessment of the “aging” physician the FSMB would probably buy it. Is potentially potentially impairing illness next.? There has been no apparent inquiry or opposition to this.

Accountability requires both the provision of information and justification for actions and they have minimized both. Prohibiting doctors from obtaining their own assessments, medical records and drug-testing records markedly reduces risk of exposure as does prohibiting release of those records to third parties. Cash only prevents inquiry from insurers. The PHPs have no oversight or regulation. The drug and alcohol testing labs have no FDA oversight as the tests are non-FDA approved. Other than accreditation agencies such as the College of American Pathologists there is no agency to investigates error or misconduct. CAP cannot sanction. The assessment and treatment centers have little oversight or regulation. In sum this system refuses to provide information and even if they did provide information they do not have to justify it to anyone and no agency exists to punish them even if they could not justify it. Zero accountability.

And with zero accountability corruption not only thrives but is inevitable. The simple extortion scheme from 1995 has now grown to around two dozen “PHP-approved” assessment and treatment centers and state boards require that only “PHP-approved” facilities be used and specifically excludes non “PHP-approved” facilities. The preferred facilities engage in “diagnosis rigging” and false diagnoses to warrant unneeded treatment. The labs such as USDTL and Quest engage in laboratory misconduct and will create a falsely positive test at client request. It is a closed system where everything is kept within the PHP circle.

And complete regulatory capture has been achieved through autonomous units within Boards that essentially serve as PHP protection units and hired guns. They protect the PHP and their friends and also act as an assassin squad to do whatever the PHP wants them to do to suspend, revoke and interfere with the medical licenses of doctors any which way they want.

In Massachusetts Policy 94-002 created Physician Health and Compliance Unit (PHCU) Board counsel as an independent unit outside the enforcement division of the Massachusetts Board of Registration in Medicine by design.

This additional circle around the closed-loop system provides an additional layer of protection to prevent the fraud and abuse from being discovered. That the Massachusetts Board is not under any active supervision from the executive branch has been confirmed in writing to the Massachusetts Legislature by Governor Charles Baker in a letter accompanying his Bill (H.4188) which aimed to finally establish a framework for active supervision and oversight over the Board.

These units enforce PHP policy and requirements including the restriction of assessments to the out of state (“PHP-approved”) assessment and treatment centers and forbid any outside assessments. Any doctor in Massachusetts will be forced to go to Georgia, Alabama, Arkansas, Kansas or some other remote venue for an evaluation under the guise of special knowledge. Any doctor reported to the PHCU as “non-compliant” is summarily suspended. Truth and evidence are irrelevant. The opinions of all outside experts no matter how qualified or how many are not only dismissed they are patently ignored with eyes wide shut. They simply do not register anything outside the racket. They abuse administrative law procedure to dismiss, deflect and delay. Having the power to act as both a hearing-officer to accept or exclude evidence and present cases to the Board and make disciplinary recommendations provides them with absolute power to render judgment. It means they are in charge of every decision made, and they have the power to be rid of whomever they choose as judge, jury and executioner. The Board’s simply defer to PHCU Board counsel and give little thought or time to what was presented and ratify whatever is asked. They are uninformed and disengaged.

The system is almost foolproof. It is a culture of impunity and deference. To make matters worse states Attorney Generals defer to the medical-board and their physician health experts. The AGO represents the state agency and its expert in legal challenges and crimes reported by doctors are dismissed at the outset. The agency responsible for investigating rackets and laboratory and healthcare fraud as well as civil rights violations and color of law abuse is the states AGO. No one is minding the minders.

The assistant AGOs representing boards appear to use the same tactics as the PHCU Board counsel and a similar moral disengagement mentality but it is unclear what the interface is with the PHP/medical board and states AGOs. If anyone has any insight please advise as I have not figured it out. Perhaps they agreed to deference to the medical board/PHP just as the medical board agreed to deference to the PHP. Perhaps they have specific administrative attorneys who they use or even a cadre within but it is implausible that the entire AGO would be supporting the rehab racket.

Then again the Florida AGO knew in 2012 that Millennium Laboratories, the nation’s largest drug testing company, was defrauding Florida Medicaid of millions in a massive drug screening scam persuading doctors to test Medicare patients for Angel Dust. It billed Medicare for 59 dead people. It bribed doctors and rigged research results and made a mint from getting doctors to order expensive drug tests that were not needed but Florida AGO Pam Bondi in a March 2014 letter to the head of the federal Centers for Medicare and Medicaid Services, argued the tests were indeed needed. Turns out Millennium once salvaged a key anti-drug initiative championed by Bondi and, through its high-powered lobbying firm, had deep ties to Bondi and Gov. Rick Scott’s legal team.

In the final analysis this has resulted in is a complete systems failure where corruption and abuse is occurring as a product of bad apples in plain view and within the walls of regulatory medicine with each agency deferring to the integrity and honesty of its predecessor. This is not good governance.

Historians will someday look back at the fall of American medicine and wonder how it was allowed to happen and link systemic as well as specific problems pervasively plaguing the profession with regulatory capture by the drug and alcohol testing, assessment and treatment industry.

Excellent article. Boards are violating everyday, who is the watchdog?
Debra Stoller looks like an old has been, cannot make a living in an office , and was probably the school yard little tattle tale that had to be the teachers pet. A real anti social personality disordered individual.

Lol and hopefully after the state audit investigating her corrupt unit ( which is set to begin sometime after July) she will be sent to the Walpole women’s prison and prohibit her from donning her wig like they did with Buddy Cianci

I am looking forward to seeing the audit report ! How did it come about for them to do an audit ? Pressure , request?
Nice !
Yes the hair is about 30- 40 years younger than the face. Wasn’t Walpole where Henandez was ? just saying . She could have the same thought process as the ones she was convicting . It will be a nice Karma

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